Note: Our daily “S&P 500 Outlook, Forecast, and Trading plan” will be posted around 9:00am EDT, every trading day.
For the Outlook, Forecast, and Trading Plans published this morning, please click here
For the last published Results of the Morning Trading Plans, please click here.
THE GIST (“THE WHAT”)
Choppy directionless trading continues as investors keenly await clarity on trade front. Consolidating near record highs, the S&P 500 index inched slightly higher to eke out a yet another record close at 3096.63, up by only 2.59 points over previous day’s close.
THE DETAILS (The “How & Why”):
On the trade front, reports that both the disputing countries are struggling to finalize the initial phase one of trade deal amid disagreement over farm purchases and intellectual property provisions dragged the index lower mid- session.
Meanwhile, in his second day of Congressional testimony, Fed Chair Jerome Powell maintained his stance that the monetary policy is likely to remain on hold as the risk of the U.S. economy to fall into recession any time soon is remote. Treasury yields slipped for the second straight session amid political and trade uncertainties.
The 10-year Treasury yield fell to a one-week low, settling at 1.815%. On the economic data front, jobless claims hit a 5-month high of 225,000. The Producer Price Index posted its biggest jump in six months, rising 0.4% in October but still remaining tamed.
Mixed bag of earnings by Cisco and Walmart failed to provide a meaningful direction to the price action. Sector-wise performance was mixed with Real Estate and Materials sectors leading the advances and Energy stocks lagging the most. Oil prices slipped following reports of a larger-than-expected build-up in domestic crude inventories.
Cisco Systems Inc. was the worst decliner of the session, tumbling 7.33% on issuing a weaker-than-expected revenue guidance that overshadowed an upbeat quarterly result. Meanwhile, Walmart Inc., the bellwether of the U.S. consumer economy hit an all-time high but closed 0.27% lower on beating revenue and earnings estimates on the back of a solid performance in its grocery shopping segment. The retail giant also boosted its full-year forecast ahead of the upcoming holiday season.